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Kim Hardware Company has $6,000 to invest. Management is trying to decide between two alternative uses of the funds as follows: Project A Project B
Kim Hardware Company has $6,000 to invest. Management is trying to decide between two alternative uses of the funds as follows: Project A Project B Annual cash inflows $1,300 Single cash inflow at the end of 10 $19,000 years Life of the project 10 years 10 years Kim Hardware has a hurdle rate of 9% for this type of investment. a) What is the NPV for Project A? b) What is the NPV for Project B? c) Which project should Kim invest in
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